Section 23 of The Interest-tax Act, 1974
1[23. Failure to comply with notices.--If any person fails, without reasonable cause, to produce or cause to be produced, any accounts or documents required to be produced under section 8, he shall pay by way of penalty, a sum which shall not be less than one thousand rupees, but which may extend to twenty-five thousand rupees, for each such failure.]
Summary
- A person faces a penalty if they fail to produce accounts or documents when asked.
- This applies to requests made under Section 8 of the Act.
- The penalty ranges from one thousand rupees up to twenty-five thousand rupees for each failure.
- A person can avoid the penalty if they can show they had a reasonable cause for failing to comply.
Practical examples
FAQ
1. What happens if I ignore a notice to produce my financial accounts?
You will have to pay a penalty between one thousand and twenty-five thousand rupees.
2. Does the penalty apply just once, or every time I fail to comply?
The penalty applies for each separate failure to comply.
3. Is there any way out of the penalty if I truly could not produce the documents?
Yes, you will not be penalized if you failed to produce them due to a reasonable cause.
Test yourself
Q1.Under Section 23 of The Interest-tax Act, 1974, what is the minimum penalty amount for failing to comply with a notice to produce accounts?
Q2.Under Section 23 of The Interest-tax Act, 1974, what is the maximum penalty limit for a single failure to produce required documents?
Q3.Under Section 23 of The Interest-tax Act, 1974, how is the penalty applied if a person ignores multiple requests?
Q4.Under Section 23 of The Interest-tax Act, 1974, a penalty is triggered for failing to produce documents required under Section 8. What exactly does Section 8 allow the officer to do that triggers this penalty if ignored?